ALH holders get another month to decide

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Woolworths boss Roger Corbett and Victorian hotelier Bruce Mathieson have extended their $970 million offer for Australian Leisure & Hospitality by a month and revealed more about their intentions for the nation's largest pubs and pokies group.

The Bruandwo joint venture of Woolworths and Mr Mathieson is yet to convince the market, analysts and the ALH board about the merits of its $2.75 a share bid but remains keen to give the impression it is "digging in" during the slowly heating takeover battle.

"We are standing firmly by the $2.75 bid and are not in a rush," a Bruandwo spokesman said.

Mr Corbett has criticised an independent expert's report valuing ALH at $3.19 to $3.42 a share and questioned solid profit forecasts provided by the company in its target's statement released last week; he is expected to write to ALH shareholders this week.

With ALH shares trading well above the offer price - the stock closed 7c lower at $3.02 yesterday - and most analysts valuing the company above $2.80 a share, some observers said the decision to extend the offer until September 27 might take some of "the heat" out of the ALH share price.

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"If this drags on for a while and no rival bid from Coles Myer emerges, the shares should trade lower though you wouldn't imagine they will sink much below $3," one fund manager said.

Coles Myer is believed to be watching the bid closely but is yet to make contact with ALH, whose directors met in Melbourne yesterday.

Bruandwo, which owns 16 per cent of ALH, also provided more detail about its operations and plans for ALH's dividend policy (may be reduced), new board members (should include Mr Corbett and Mr Mathieson) and integration (will commence a review of ALH) following a Takeovers Panel ruling last week.

The panel based its ruling on the offer's 50.1 per cent acceptance condition, which could leave a number of shareholders on the register.

In a supplementary statement yesterday, Bruandwo pointed out: "Woolworths' liquor sales have grown from approximately $800 million to $2.1 billion over the last four years."